Domain REIT (1 Viewing)

CanuckDomains

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Has anyone ever started an REIT/mutual fund/ETF‐like pool of domains for people to invest in? Just asking out of curiosity, I think it would be an interesting idea. I get the feeling this has been covered before on this forum or on Twitter but if it has I can't find the original post. Anyway, thoughts?
 
I know of two attempts like that and two platforms intended for fractional domain ownership (one of them was called Fusu, but it was long shut down). I'll try to find more details later.

Was Internet Real Estate group one of the funds attempted or was this closed to a limited pool of investors? And maybe DomainIndex?
 
It's not for me. The whole point of investing in domains is to have the flexibility and control over when, why, how, and for how much I can sell these digital assets.

Micro-ownership eliminates all of these advantages and also introduces a pile of negatives.

For example, let's say you invested in a premium 1-word with 100 other people, and (what you think is) a great offer comes in allowing a massive ROI that would really help you right now.

It's put to a vote and your side loses 60% to 40%... so you make $0 and you can't sell your portion back at the offer price, so you're stuck and could be stuck for the rest of your lifetime. Or even worse, there could be a lowball offer that you totally disagree with it, but the economy is bad and a few big investors need to get their money out so again you lose the vote 55% to 45% and your investment ROI tanks.

No control = no way.
 
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No control = no way.
That's why I was thinking of something more along the lines of a mutual fund or hedge fund. You get a Domainer or a team of domainers with a reputation and a great history of returns to manage a portfolio which people can invest in as they please. No control, but if the team is competent and experienced you have a shot at a good ROI. And I'm thinking about people who don't want to get into domaining themselves, or who don't have the time/funds to manage a large portfolio. It wouldn't make sense for you, but it might make sense for someone like me.
 
Domain investing works because of the inefficient market IMO.

In my view, most domains are a bad fit when it comes to an ETF type situation.

They are not liquid and prices are highly subjective.

The same portfolio could yield wildly different results based on business models and other factors.

Brad
 
That's why I was thinking of something more along the lines of a mutual fund or hedge fund.

Too bad these two examples have virtually 100% liquidity (assuming they're licensed and legit) while a box of domains have approximately 0% immediate liquidity.

Domains just don't work in this model and you can't fit a square peg in a round hole.
 
Domain investing works because of the inefficient market IMO.

In my view, most domains are a bad fit when it comes to an ETF type situation.

They are not liquid and prices are highly subjective.

The same portfolio could yield wildly different results based on business models and other factors.

Brad
True, true. It's unrealistic but still an interesting thought. Just for the sake of being argumentative, what if you set it up as a sort of hedge fund with a lock up period where you can't withdraw your money until, I dunno, 20 years from now? And the managers plan to completely liquidate by that date? Or you could set it up as an REIT where the managers plan to make a decent amount of their money from running websites on their domains.
 
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Too bad these two examples have virtually 100% liquidity (assuming they're licensed and legit) while a box of domains have approximately 0% immediate liquidity.

Domains just don't work in this model and you can't fit a square peg in a round hole.
Wait, hedge funds? 100% liquid? Whatever you say boss...
 
what if you set it up as a sort of hedge fund with a lock up period where you can't withdraw your money until, I dunno, 20 years from now?

20 years? Hokay... :oops:

It brings to mind the reaction of Ben Whittaker (Robert DeNiro) in The Intern when an interviewer asked him "Where do you see yourself in 10 years?"

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Wait, hedge funds? 100% liquid? Whatever you say boss...

Companies buy and sell portions of their hedge funds as the market changes. Options, stocks, cash, loans, gold, etc. whatever they choose to make a hedge with. They may make money or lose, but the components of the funds are liquid and tradeable, even at a loss.

I don't think any hedge fund contains domains, but correct me if I'm wrong.

If someone out there is running a "hedge fund" using the "future value of stale donuts", "tulip bulbs". and "old Dukes of Hazard bubblegum cards" as their investment base, that's not a true fund, but just a bunch of whackos losing money.
 

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